When success breeds failure: History, hysteresis, and delayed exit decisions.

Abstract

The effects of feedback equivocality, information availability, and prior decision-making history on escalation and persistence were investigated. Replicating the findings of J.L. Bragger, D.H. Bragger, D.A. Hantula, and J.P. Kirnan (1998), this study found that participants receiving equivocal feedback on their decisions invested more money and invested across more opportunities; those who could purchase information invested fewer resources than did participants who did not have the opportunity to purchase information. There was an inverse linear relationship between the percentage of opportunities in which participants purchased information and the delay to exit decisions and total resources invested. Six weeks earlier, some participants took part in a more profitable investment scenario, and prior experience led to later increased investing when participants were faced with failure, even above that invested in a preceding, succeeding scenario. These results are consistent with an equivocality theory account of escalation.

Organizational Error Management Culture and Its Impact on Performance: A Two-Study Replication.

“…Given dynamic changes, prior success may lead to a lower degree of success in the future (Audia, Locke, & Smith, 2000;Bragger, Hantula, Bragger, & Kirnan, 2003). Lack of error management in a firm may help to explain the "paradox of success."…”

Real Options: Taking Stock and Looking Ahead

“…Bragger and colleagues (Bragger et al 1998;Bragger, Hantula, Bragger, Kirnan, and Kutcher 2003) note that much research on escalation of commitment in social and organizational psychology has been conducted in an attempt to determine why individuals violate rationality and make 'erroneous' decisions to increase investment under failure (Staw 1981;Staw and Ross 1989). Escalation of commitment is more likely to occur when decision makers have received more equivocal feedback.…”

Unraveling equivocality in evaluation of information systems projects

“…The evaluation, which shows the past performance and the future attainment of projects, is a reference point when making continuation decisions (i.e., deciding escalation or abandonment) ( The studies of equivocality in psychology have used experimental settings to examine effects of equivocality on escalation and abandonment decisions (Bragger et al 1998;Bragger et al 2003). However, the main limitation of these studies is that they did not specifically examine the causes of equivocality.…”

“…The importance of equivocality in affecting continuation decisions is recognized as well in other fields. Equivocality is attributed to problematic evaluations; improper decisions can hamper decision-makers in achieving the objective of an evaluation (Bragger et al 2003;Sleesman et al 2012). …”

“…Equivocality is influenced by a contextual interpretation as the information is seen as neither clearly positive nor clearly negative (Hantula and DeNicolis Bragger 1999). Bragger et al (2003) demonstrate that equivocal information resulted from insufficient goal specificity leads to escalation and persistence. Possibility to obtain additional information and prior decision-making history may also affect the decision to escalate.…”